"Wife Swap" StarNo Longer an Alleged Prostitute

12/11/2012 5:25 PM PST BY TMZ STAFF

The former "Wife Swap" star who was charged with exchanging sex for money back in August ... can officially join the "not a prostitute" club ... because the charge has been dropped, TMZ has learned.

As we previously reported ... 21-year-old Alicia Guastaferro -- who was on the show back in '08 -- was arrested in New Yorkafter cops caught her half naked with a 54-year-old male lawyer ... in the back seat of a car.

But Guastaferro got some good news Tuesday night ... the District Attorney's Office dropped the prostitution charge in the "interest of justice" -- aka extreme leniency.

Alicia's not out of the woods yet ... she still faces several other charges from the same incident: criminal impersonation, criminal possession and possession of a controlled substance.